Dominion Citrus Limited
TSX : DMN.PR.A
TSX : DOM.UN

Dominion Citrus Limited

March 23, 2006 18:00 ET

Dominion Citrus Limited Announces Fiscal 2005 Results

TORONTO, ONTARIO--(CCNMatthews - March 23, 2006) - Dominion Citrus Limited ("Dominion", the "Company") (TSX:DOM.UN)(TSX:DMN.PR.A) -

2005 Report to Shareholders

Fiscal 2005 Highlights

- Revenue of $125,849,000 down $5,770,000, or 4.4% from last year.

- Net earnings were $2,321,000, up from $1,188,000 in fiscal 2004.

- Fully diluted earnings per share of $0.11 versus $0.06 last year.

- The cash position improved by $3,739,000 or $0.19 per basic share outstanding.

- Completed the conversion to an income fund structure, effective January 1, 2006.

- Hired an experienced sales and marketing executive with food industry experience to head the Company's maple syrup business.

- Opened a 58,000 sq. ft. state-of-the-art processing and refrigerated warehousing facility in Toronto in October.

- Completed the construction of a 5,400 sq. ft. refrigerated addition to its existing 2,700 sq. ft. Quebec City facility.

The Company reports revenue of $125,849,000 for fiscal 2005, down 4.4% compared to $131,619,000 last year. This generated earnings, before the portfolio and Catanti related income (expense), of $3,443,000 versus $4,131,000 in the prior year. Net earnings were $2,321,000 versus $1,188,000 last year, or fully diluted EPS of $0.11 versus $0.06 last year.

Jacques Lavergne, President and CEO commented that "Adverse weather conditions negatively impacted volumes in the Produce business segment while the loss of some US based maple syrup co-packing business was the major contributor to the volume decline in the other food segment".

He further commented: "While we cannot influence the weather we attempt to mitigate these supply disruption problems by strengthening existing supplier relationships and developing new ones with international producers. We have hired an experienced sales and marketing executive with food industry experience for Delta who is beginning to demonstrate results, and invested in facilities and equipment that should allow us to pursue new business opportunities".

"Consolidation of participants in the business segments in which we compete remains an important opportunity to improve margins and costs. We will maintain our disciplined approach to pursuing our expansion strategy".



Dominion Citrus Limited Year End Results
(Audited)
12 months ended December 31

2005 2004(1)
---- -------

Revenue $125,849,000 $131,619,000

Gross Margin % 18.4% 18.1%

Operating Income $3,451,000 $4,466,000

Operating Income % 2.7% 3.4%

Other income (expense) $(8,000) $(335,000)

Income before portfolio & Catanti
related income (expense) $3,443,000 $4,131,000

Portfolio & Catanti related income
(expense) $21,000 $(1,649,000)

Earnings Before Tax $3,464,000 $2,482,000

Net Earnings $2,321,000 $1,188,000

EPS (Basic) $0.12 $0.06

EPS (Fully diluted) $0.11 $0.06

Non-GAAP Measures
-----------------
Net earnings from operations before
the portfolio & Catanti related
income (expense) $2,300,000 $2,614,000

EPS (Basic) from operations before
the portfolio & Catanti related
income (expense) $0.12 $0.13

Weighted average common shares
outstanding 19,857,571 19,754,788


(1) On December 31, 2005, Dominion adopted the revisions to CICA Handbook Section 3860, Financial Instruments - Disclosure and Presentation, with retroactive restatement of prior period comparatives. These revisions require liability classification for preference shares that could be settled by issuing a variable number of Dominion's common shares in exchange for the preference shares and any outstanding dividends thereon. As a result, Dominion reclassified as liabilities, the Series A preference shares previously included in Shareholders' Equity, which were $2,297,000 as at December 31, 2005 (2004 - $2,222,000; 2003 - $2,218,000). Dividends on these Series A preference shares, which were shown as a charge to retained earnings, have been reclassified to interest expense in the Consolidated Statements of Earnings. Net income for 2005 and 2004 has been decreased by $141,000 and $136,000 respectively. There was no change to either basic or fully diluted earnings per share.

Outlook

Management believes the segments of the food industry in which the Company participates will remain highly competitive and result in continuing volume and margin pressures.

The Company will continue to advance its strategy of expanding as a diversified food supplier in the food industry through the pursuit of acquisitions and alliances. The challenge continues to be the availability of attractive acquisition targets for expansion at a reasonable cost.

About Dominion

Effective January 1, 2006, Dominion Citrus Income Fund (the "Fund") acquired all the issued and outstanding common shares of the Company in exchange for units of the Fund, on a one-for-one basis. The Fund is a publicly traded, unincorporated, open-ended limited purpose income trust and the trust units are listed on the TSX under the symbol DOM.UN. The Series A preference shares of Dominion continue to be listed on the TSX under the symbol DMN.PR.A.

Dominion is a diversified food company supplying fresh produce, premium juices and maple syrup to a wide variety of customers in retail, foodservice and food distribution businesses. The Company provides procurement, processing, repacking, sorting, grading, warehousing and distribution services to over 400 customers, with its major domestic markets being Ontario and Quebec. The Company also supplies products to customers in the United States and Europe. The website may be accessed at www.dominioncitrus.com.

Caution regarding Forward-Looking Statements

This release contains statements, which, to the extent that they are not a recitation of historical fact, may constitute "forward-looking statements". Forward-looking statements may include financial and other projections, as well as statements regarding our future plans, objectives or performance, or our underlying assumptions. The words "estimate", "anticipate", "believe", "expect", "intend" or other similar expressions of future or conditional verbs such as "will", "should", "would" and "could" are intended to identify forward-looking statements. Persons reading this press release are cautioned that such statements are only expectations, and that our actual results or performance may be materially different.

Forward-looking information involves certain risks, assumptions, uncertainties and other factors, which may cause actual future results to differ materially from those expressed or implied in any forward-looking statements.

Readers should not place undue reliance on these forward-looking statements when making decisions, and should consider the date onto which the statements were made. Except as required by applicable security law, management disclaims any intention or obligations to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Contact Information

  • Dominion Citrus Limited
    Investors: E. A. Atkinson
    VP Finance, CFO & Corporate Secretary
    (416) 242-8341 ext 249
    or
    Dominion Citrus Limited
    Media: J. L. Lavergne
    President & CEO
    (416) 242-8341 ext 250